A call to parliament to reject inappropriate amendments to the Public Finance Management Act, 2015

Ministry of Finance, Planning and Economic Development is seeking parliament approval to amend the Public Finance Management Act, 2015 (PFMA), which has shuttered hopes on promoting prudent public finance management in Uganda. The Minister of Finance, Planning and Economic Development, Matia Kasaija, on 30th September 2015 tabled in Parliament amendments to the Public Finance Management Act, 2015 among others seeking to give Government the leeway to access funds from the Central Bank without prior approval of Parliament.

Uganda Debt Network (UDN) together with other civil society actors under the umbrella of Civil Society Budget Advocacy Group (CSBAG) made a call to Parliament to reject amendments to the Public Finance Management Act, 2015 during a press conference held by the Civil Society actors in Kampala. Whereas it would be justified to amend any law, the amendments contained in the Minister’s submission should be vetoed. The PFMA, 2015 as it is, is strong on checks and balances, legislative oversight as well as gender and equity. The proposed amendments are now contrary to keeping prudent Finance Management principles in Uganda.

Civil Society Concerns

Some of the Amendments Government is proposing for such as:

Section 9 of the Public Finance Management Act, Government is proposing to substitute the word “Accounting Officer” with “Sector‟ and “vote‟ with “sector‟. The major concern is that by choosing to replace Accounting Officer‟ with “Sector”, it becomes difficult for the public to hold public officers accountable. We believe there is it’s impossible to holding a ministry accountable instead of its permanent secretary or minister. Such an amendment protects accounting officers from being held accountable for misusing public resources.

Section 13,(15)(g): By having the Certificate of Gender and Equity in the public finance law, Uganda had been rated at about 78 in terms of integrating gender in planning and budgeting. However with this proposed amendment to repeal the Certificate of Gender and Equity, the country is likely to lose this rating considering Uganda was the first country in the world to have gender clause in Public Finance Management laws. Certificate for Gender and Equity responsiveness is very critical if the country is to attain gender responsive and sustainable development. The current section in the law was a compromise position and such government needs time to test this process.

Section 17of the Principal Act if amended proposes that if a vote does not to utilize money of a given financial year shall by the end of the 31st July of the following financial year, authorization may be sought from the Permanent Secretary/Secretary to the Treasury to retain that money by up to 31st October of the financial year. This amendment undermines the power of Parliament and may encourage misuse of public funds.

Section 36 proposes that Government can acquire any loan that does not extend beyond a financial year without Parliament approval. This move undermines the role of Parliament to approve all loans as provided for in constitution of Uganda. In the amendment for Section 22 of the PFMA, we are against the proposal to widen the scope of a virement to be more than 10% of the vote is a gross deviation and may perpetuate financial indiscipline.

Section 82 seeks to give Bank of Uganda power to make temporary advances to government and local governments in respect to temporally shortages of the recurrent revenue, without approval of parliament. This proposal undermines the role of Parliament to approve all loans but allows Bank of Uganda to print money for fiscal use which is an undesirable PFM move.